Human Resource Planning… Objectives of Human Resource Planning (HRP) › HRM Megaposts

Administration of Human Resources in Organizations

Administration of Human Resources:

1. Human Resource Planning
2. Objectives of Human Resource Planning (HRP)
3. Human Resource Planning at Different Levels
4. Human Resource Planning Process
5. HR Demand Forecasting - Techniques
6. HR Supply Forecasting - succession analysis - Markov Analysis
7. Employee Motivation Introduction
8. Motivation Process
9. Theories of Motivation
10. Maslow’s Need Hierarchy
11. Existence Relatedness Growth (ERG) Theory
12. McGregor’s Theory-X and Theory-Y
13. Expectancy Theory
14. Reinforcement Theory
15. Herzberg two factor theory
16. McClelland (Needs for Affiliation, Power, and Achievement) Theory of Motivation
17. Adam’s Equity Theory
18. Methods for Motivating Employees for Employee Satisfaction
19. 20 ways to motivate your employees without raising their pay.
20. Employee Retention

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Human Resource Planning

According to Mondy et (1996) Human Resource Planning is a systematic analysis of HR needs in order to ensure that correct number of employees with the necessary skills are available when they are required.
To understand the Human Resource Planning First, we will see what is Planning? and why is it needed?
What is planning? Plans are methods for achieving a desired result. Goals or objectives are specific results you want to achieve. Planning is thus “the process of establishing objectives and courses of action prior to taking action.”
What is planning concerned with? Planning provides a sense of purpose and direction. It is a comprehensive framework for making decisions in advance. It also facilitates the organizing, leading, and controlling functions of management. Planning: allows you to make your decisions ahead of time, it helps you to anticipate the consequences of various courses of action, it provides direction and a sense of purpose, it provides a unifying framework against which to measure decisions, and thus helps you avoid piecemeal decision making. Planning also helps identify potential opportunities and threats, and facilitates control. It is concerned with the end (what is to be done) as well as with means (how it is to be done).
Human Resource Planning (HRP) may be defined as strategy for acquisition, utilization, improvement and preservation of the human resources of an enterprise. The objective is to provide right personnel for the right work and optimum utilization of the existing human resources. HRP exists as a part of the planning process of business. This is the activity of the management which is aimed at co-ordinating requirements for and the availability of different types of employers. The major activities of HRP include: forecasting (future requirements), inventorying (present strength), anticipating (comparison of present and future requirements) and planning (necessary programme to meet future requirements).
Human Resource Planning involves gathering of information, making objectives, and making decisions to enable the organization achieve its objectives and goals. Surprisingly, this aspect of HR is one of the most neglected in the HRM field. When Human Resource Planning is applied properly in the field of Human Resource Management, it would assist to address the following questions:
1. How many number of staff does the Organization have?
2. What type of employees as far as skills and abilities does the organization have?
3. How should the Organization best utilize the available human resources?
4. How can the organization keep its employees?
Human resource planning has been defined by various authorities on this subject as under:
"It is almost as difficult to keep a first class person in a fourth class job, as it is to keep a fourth class person in a first class job."
-- Paul H. Dunn

Definitions of Human Resource Planning

Human resources planning is the process by which management ensures that it has the right personnel, who are capable of completing those tasks that help the organization reach its objectives. It involves the forecasting of human resources needs and the projected matching of individuals with expected vacancies. -----International Labour Organization
According to Coleman, "Manpower planning is the process of determining manpower requirements and the means for meeting those requirements in order to carry out the integrated plan of the organisation".
According to Jeisler, "Manpower planning is the process including forecasting, developing and controlling— by which a firm ensures, it has the right number of people and the right kind of people and at the right places at the right time doing things for which they are economically most useful"
According to Dale S. Beach, "Human resource planning is a process of determining and assuring that the organisation will have an adequate number of qualified persons, available at the proper times, performing jobs which meet the needs of the enterprise and which provide satisfaction for the individuals involved."
According to Wickstron, "Human resource planning consists of a series of activities viz.:
• Forecasting future manpower requirement either in term of mathematical projection of trends in the economic environment and development in industry or in term of judgmental estimates based upon the specific future plans of a company.
• Making an inventory of present manpower resources and assessing the extent to which these resources are employed optimally.
• Anticipating manpower problems by projecting present resources into the future and comparing them with the forecast of requirements to determine their adequacy, both quantitatively and qualitatively; and
• Planning the necessary programs of recruitment, selection, training, development, transfer, promotion, motivation and compensation to ensure that future manpower requirements are properly met.
Hiring the right kind of people was cited as the most important challenge by 98 per cent of HR and business leaders in a survey. The second most-cited concern was retaining this talent, backed by 93 per cent of respondents.
Facts
48% of Indian employers struggle to find the right candidate
June 2012,BANGALORE: The battle for the right candidate continues to rage as 48% of Indian employers struggle to find the right candidate for the job. A study on Talent Shortage by staffing firm Manpower Group shows that although down by 19% from last year, India's hunt for suitable employees is high compared to global average of 34%.
The profiles on demand have also altered since same period last year. While it was difficult to hunt for R&D, sales manager and IT staff last year, this year the positions are for IT staff, marketing/public relations/communication staff and engineers. Personal assistants, call centre operators, researchers are also hard to find this year. Professions like labourers, doctors that had made it to the list have been struck off this time.
Lack of available candidates, technical competencies amongst those present,refusal to move to another location, poor image of the occupation, weak soft skills and demand for a higher salary have been key reasons in Asia Pacific for the posts to remain vacant.
PROBLEMS IN HRP PROCESS
The main problems in the process of HRP are as follows:
a) Inaccuracy: Human Resource Planning is entirely dependent on the HR forecasting and supply, which cannot be a cent per cent accurate process.
b) Employee resistance: Employees and their unions feel that by Human Resource Planning, their workload increases so they resist the process.
c) Uncertainties: Labour absenteeism, labour turnover, seasonal employment, technological changes and market fluctuations are the uncertainties which Human Resource Planning process might have to face.
d) Inefficient information system: In Indian industries, HRIS is not much strong. In the absence of reliable data it is not possible to develop effective Human Resource Planning.
e) Time and expense: Human Resource Planning is time consuming and expensive exercise, so industries avoid.
Facts
According to a recent study on workforce engagement, nearly one-third of the U.S. workforce fits the category of “unengaged.” Unengaged employees perform their jobs in ways that do not contribute to organizational success, performance, and profitability. The productivity loss of unengaged workers equals nearly $300 billion a year.

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[ 2 ]

Objectives of Human Resource Planning (HRP)

1. To recruit and maintain the HR of requisite quantity and quality.
2. To predict the employee turnover and make the arrangements for minimizing turnover and filing up of consequent vacancies.
3. To meet the requirements of the programmes of expansion, diversification etc.
4. To anticipate the impact of technology on work, existing employees and future human resource requirements.
5. To progress the knowledge, skill, standards, ability and discipline etc.
6. To appraise the surplus or shortage of human resources and take actions accordingly.
7. To maintain pleasant industrial relations by maintaining optimum level and structure of human resource.
8. To minimize imbalances caused due to non-availability of human resources of right kind, right number in right time and right place.
9. To make the best use of its human resources; and
10. To estimate the cost of human resources.
So, human resource planning is required to achieve the objectives of estimating potential human resources requirements; to cope with changing requirements of the organisation taking into consideration the changing technology; to make full utilization of the existing and potential workforce of the organisation; and career planning of employees.
Facts
According to a recent study on workforce engagement, nearly one-third of the U.S. workforce fits the category of “unengaged.” Unengaged employees perform their jobs in ways that do not contribute to organizational success, performance, and profitability. The productivity loss of unengaged workers equals nearly $300 billion a year.

Benefits/Importance of Human Resource Planning

Human resource planning or manpower planning is necessary for ail organisations because of following reasons:
To meet up requirements of the organisation: To do work in the organisation, every organisation needs personnel of desired skill, knowledge and experience. This human resources requirement of organisation can be effectively fulfilled through proper human resource planning. It helps in defining the number of personnel as well as kind of personnel required to satisfy its needs. It ensures the reservoir of desired human resources as and when required.
Counterbalance insecurity and change: There must be proper utilisation of human and non-human resources in the organisation. Sometimes the organisation may have adequate non-human resources e.g. machines, materials and money but inadequate human resources as a result, manufacturing process/production cannot be started. Human resource planning helps to offset uncertainties and changes as far as possible and enables to ensure availability of human resources of the right kind, at right time and at right place.
It helps in checking labour imbalance: Human resource planning helps to anticipate shortages and/or surpluses of manpower in the organisation. The shortage of manpower as well as surplus of manpower is not good for the organisation. It proves very expensive for the organisation. In case of shortage of human resources, physical resources of the organisation cannot be properly utilized. In case of surplus of human resources, this resource may remain under-utilized It helps in counter balancing the problem of shortage and surplus employees very comfortably. Human resource planning helps in correcting this imbalance before it become unmanageable and expensive.
Right-sizing the human resource requirements of the organisation: In an existing organisation, there is a constant need for right-sizing the organisation. In the organisation, some posts may fall vacant as a result of retirement, accidents, resignations, promotions or death of employees. Consequently, there is constant need of replacing people. Human resource planning estimates future requirements of the organisation and helps to ensure that human resources of right kind, right number, in right time and right place.
To meet expansion and diversification needs of the organisation: It helps to execute future plans of the organisation regarding expansion, diversification and modernization. Through human resource planning it is ensured that employees in right number and of right kind are available when required to meet these needs of the organisation. It ensures that people of desired skills and knowledge are available to handle the challenging job requirements.
Training and Development of Employees: There is constant need of training and development of employees as a result of changing requirements of the organisation. It provides scope for advancement and development of employees through training and development etc. Thus, it helps in meeting the future needs of the organisation of highly skilled employees.
Fulfill Individual Needs of the Employees: It helps to satisfy the individual needs of the employees for promotions, transfer, salary encashment, better benefits etc.
Helps Formulation of Budgets: It helps in anticipating the cost of human resources e.g. salary and other benefits etc. It facilitates the formulation of human resource budget for various departments/divisions of the organisation. So, it may also help in, the formulation of suitable budgets in an organisation.
To Check Joblessness: In the exercise of right-sizing of employees by the organisation, some of the employees may become surplus. It means their services are no more required in the organisation. It tries to foresee the need for redundancy. It plans to check job loss or to provide for alternative employment in consultation with various concerned parties and authorities.

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[ 3 ]

Human Resource Planning at Different Levels

Human Resource Planning
Human resource planning is done at various levels for their own purposes by various institutions. There are various levels of human resource planning in an industrial enterprise:
1. National Level
2. Sectoral Level
3. Industry Level
4. Unit Level
5. Departmental Level
6. Job Level
1. National Level: Generally, central government plans for human resources for the entire nation. It anticipates the demand for and supply of human requirements at the national level.
2. Sectoral Level: Central and state governments also plan human resource requirements at sectoral level. It tries to satisfy needs of some particular sectors like Agriculture
Sector, Industrial Sector and Service Sector.
3. Industry Level:
This level of planning is done to suit manpower needs of a particular industry such as Engineering, Heavy Industries, Paper Industry, Consumer Goods Industries. Public Utility Industries, Textile, Cement/Chemical Industries etc.
4. Departmental Level:
This level of planning is done to suit the manpower needs of a particular department in a company e.g. Marketing Department, Production Department. Finance Department, etc.
5. Job Level:This level of planning fulfills the human resource needs of a particular job family within department. For example, the requirement of number of sales executes in the marketing department.

Need for Human Resource Planning at Macro Level

Major reasons for the emphasis on HRP at macro level include:
Employment-Unemployment Situation: Though in general the number of educated unemployed is on the rise, there is acute shortage for a variety of skills. This emphasises the need for more effective recruitment and retaining people.
Technological Changes: The myriad changes in production technologies, marketing methods and management techniques have been extensive and rapid. Their effect has been profound on job contents and job contexts. These changes cause problems relating to redundancies, retraining and redeployment. All these suggest the need to plan manpower needs intensively and systematically.
Organizational Changes: In the turbulent environment marked by cyclical fluctuations and discontinuities, the nature and pace of changes in organizational environment, activities and structures affect manpower requirements and require strategic considerations.
Demographic Changes: The changing profile of the work force in terms of age, sex, litercy, technical inputs and social background have implications for HRP.
Skill Shortages: Unemployment does not mean that the labour market is a buyer’s market. Organizations have generally become more complex and require a wide range of specialist skills that are rare and scarce. Problems arise when such employees leave.
Governmental Influences: Government control and changes in legislation with regard to affirmative action for disadvantaged groups, working conditions and hours of work, restrictions on women and child employment, casual and contract labout, etc. have stimulated the organizations to become involved in systematic HRP.
Legislative Controls: The days of executive fiat and ‘hire and fire’ policies are gone. Now legislation makes it difficult to reduce the size of an organization quickly and cheaply. It is easy to increase but difficult to shed the fat in terms of the numbers employed because of recent changes in labour law relating to lay-offs and closures. Those responsible for managing manpower must look far ahead and thus attempt to foresee manpower problems.
Impact of Pressure Groups: Pressure groups such as unions, politicians and persons displaced from land by location of giant enterprises have been raising contradictory pressures on enterprise management such as internal recruitment and promotions, preference to employees’ children, displace persons, sons of the soil etc.
Systems Concept: The spread of systems thinking and the advent of the macro computer as part of the on-going revolution in information technology which emphasises planning and newer ways of handling voluminous personnel records.
Lead Time: The long lead time is necessary in the selection process and for training and deployment of the employee to handle new knowledge and skills successfully.

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[ 4 ]

Human Resource Planning Process

The process of HRP is entirely based on the corporate plans and objectives. HRP is a continuous process of review, control and assessment. Figure clearly indicates the HRP process.

Process

Human resources planning is the process by which management ensures that it has the right personnel, who are capable of completing those tasks that help the organization reach its objectives. It involves the forecasting of human resources needs and the projected matching of individuals with expected vacancies.

Steps in implementation

Human resource planning begins with answering several questions:
• What new technologies are operating and how will these affect the work system?
• What is the volume of the business likely to be in the next five to 10 years?
• What is the employee turnover rate, and how much, if any is avoidable?
Once these questions are answered, then you have to ask further questions that can lead to specific human resources activities such as training or hiring:
• How many senior managers will we need during this time period?
• What types of workers will we need, and how many?
• Are there people with adequate computer skills available for meeting our projected needs?
• What administrative personnel, technicians and secretaries will we need to support the additional managers and workers?
Answering these questions will also help to define the direction for the organization's human resources strategy. For example, if forecasting suggests that there will be a strong need for more technically trained individuals, the organisation can:
• Define the jobs and skills needed in some detail.
• Hire and train recruiters to look for the specified skills.
• Providing new training for existing employees.
Other essential measures to ensure that human resources planning is an integral part of your human resources policy include:
• Creating a simple database of records with basic information on each employee (full name, date of birth, address, start date, starting wage, current wage, skills etc.)
• Developing job descriptions, performance standards and appraisals.
E.W. Vetter has visualized resources planning as "a process by which an organisation should move from its current manpower position to its desired manpower position. Through planning, management strive to have the right number and right kind of people at the right places, at the right time, doing things which result in both the organisation and the individuals receiving maximum long-run benefit."
Thus, human resource planning is a process which determines how an organisation should move from its current manpower/human resources position to its desired manpower/human resources position.
Human resource planning can be defined as the process of identifying the number of people required by an organization in terms of quantity and quality. All human resource management activities start with human resource planning. So we can say that human resource planning is the principle/primary activity of human resource management.
The process of HRP involves various steps they can be explained with the help of the following diagram.
1. Personnel demand forecast :-
This is the very first step in HRP process. Here the HRP department finds out department wise requirements of people for the company. The requirement consists of number of people required as well as qualification they must possess.
2. Personnel supply forecast :-
In this step, HR department finds out how many people are actually available in the departments of the company. The supply involves/includes number of people along with their qualification.
3. Comparison:-
Based on the information collected in the 1st and 2nd step, the HR department makes a comparison and finds out the difference. Two possibilities arise from this comparison
• No difference :-It is possible that personnel requirement = personnel supplied. In this case there is no difference. Hence no change is required.
• Yes, there is a difference :-There may be difference between supply and requirement. The difference may be
• Personnel surplus
• Personnel shortage

4. Personnel surplus :-

When the supply of personnel is more than the requirement, we have personnel surplus. We require 100 people, but have 125 people. That is we have a surplus of 25 people. Since extra employees increase expenditure of company the company must try to remove excess staff by following methods.
• Layoff
• Termination
• VRS/CRS
• No recruitment
Facts
Every year, India produces an estimated 10 lakh engineering graduates, of which two lakh are recruited by IT companies. In 2010, these companies hired 1.7 lakh engineers and in 2011, they offered jobs to two lakh.

5. Personnel shortage :-

When supply is less than the requirement, we have personnel shortage. We require 100 people; we have only 75 i.e. we are short of 25 people. In such case the HR department can adopt methods like Overtime, Recruitment, Sub-contracting to obtain new employee.
In India electrical equipment industry is facing a major problem in getting skilled and employable manpower which is technically competent, equipped with skills and ready to be deployed. "The industry is facing a looming skill gap, which is widening every year. Due to lack of skilled manpower, electrical equipment industry is suffering as it is affecting critical functions like R&D, consultancy, design and detailed engineering work," it added.
The technical education system in the country does not promote innovative thinking, it said adding training being provided in the ITIs is out dated and the students are not able to meet the aspirations of the industry.
"Even the qualified supervisors and engineers are not available. Those who are qualified are not well trained to meet the technical needs of the industry. Because of the above factors the labour productivity is far less than the labour productivity in China and Korea," the statement said.
It said that this is one of the important reasons for making the industry non-competitive and is also effecting the timely completion of the projects.
INDIA: There is about 40 per cent shortage of skilled manpower in the infrastructure sector, according to experts.
"The infrastructure sector is short of skilled manpower by about 40 per cent from the existing number of employed. The annual demand for civil engineers is 4.27 million against the current availability of 27,000," President and Whole-time Director of L&T Finance Holdings, N Sivaraman, said. Meanwhile, the shortfall of civil engineers in this decade (2010-2020) is expected to be 39.4 million," he said. .

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[ 5 ]

HR Demand Forecasting - Techniques

Forecasting human resource demand is the process of estimating the future human resource requirement of right quality and right number. As discussed earlier, potential human resource requirement is to be estimated keeping in view the organisation's plans over a given period of time. Analysis of employment trends; replacement needs of employees due to death, resignations, retirement termination; productivity of employees; growth and expansion of organisation; absenteeism and labour turnover are the relevant factors for human resourced forecasting. Demand forecasting is affected by a number of external and internal factors.
Job analysis and forecasting about the quality of potential human resource facilitates demand forecasting. So, existing job design must be thoroughly evaluated taking into consideration the future capabilities of the present employees.

Factors Affecting HR Demand Forecasting

Human Resource Demand Forecasting depends on several factors, some of which are given below.
• Employment trends;
• Replacement needs;
• Productivity;
• Absenteeism; and
• Expansion and growth.
There are number of techniques of estimating/forecasting human resources demand:
(a) Managerial Judgement
(b) Work Study Technique
(c) Ratio-trend Analysis (d) Econometric Models
(e) Delphi Model
(f) Other Techniques
(a) Managerial Judgement: Managerial judgement technique is very common technique of demand forecasting. This approach is applied by small as well as large scale organisations. This technique involves two types of approaches i.e. 'bottom-up approach' and 'top-down approach'. Under the 'bottom-up approach', line mangers send their departmental requirement of human resources to top management. Top management ultimately forecasts the human resource requirement for the overall organisation on the basis of proposals of departmental heads. Under the Top-down approach', top management forecasts the human resource requirement for the entire organisation and various departments. This information is supplied to various departmental heads for their review and approval. However, a combination of both the approaches i.e. 'Participative Approach' should be applied for demand forecasting. Under this approach, top management and departmental heads meet and decide about the future human resource requirement. So, demand of human resources can be forecasted with unanimity under this approach.
(b) Work-Study Technique: This technique is also known as 'work-load analysis'. This technique is suitable where the estimated work-load is easily measureable. Under this method, estimated total production and activities for a specific future period are predicted. This information is translated into number of man-hours required to produce per units taking into consideration the capability of the workforce. Past-experience of the management can help in translating the work-loads into number of man-hours required. Thus, demand of human resources is forecasted on the basis of estimated total production and contribution of each employee in producing each unit items. The following example gives clear idea about this technique.
Let us assume that the estimated production of an organisation is 3.00.000 units. The standard man-hours required to produce each unit are 2 hours. The past experiences show that the work ability of each employee in man-hours is 1500 hours per annum. The work-load and demand of human resources can be calculated as under:
• Estimated total annual production = 300000 units
• Standard man-hours needed to produce each unit = 2 hrs
• Estimated man-hours needed to meet estimated annual production (i x ii) = 600000 hrs
• Work ability/contribution per employee in terms of man-hour = 1500 units
• Estimated no. of workers needed (iii / iv) = 600000/1500 = 400 units
The above example clearly shows that 400 workers are needed for the year. Further, absenteeism rate, rate of labour turnover, resignations, deaths, machine break-down, strikes, power-failure etc. should also be taken into consideration while estimating future demand of human resources/ manpower.
(c) Ratio-Trend Analysis: Demand for manpower/human resources is also estimated on the basis of ratio of production level and number of workers available. This ratio will be used to estimate demand of human resources. The following example will help in clearly understanding this technique.
Estimated production for next year = 1,40,000 units
Estimated no. of workers needed
(on the basis of ratio-trend of 1: 200) will be = 700
(d) Econometrics Models:These models are based on mathematical and statistical techniques for estimating future demand. Under these models relationship is established between the dependent variable to be predicted (e.g. manpower/human resources) and the independent variables (e.g., sales, total production, work-load, etc.). Using these models, estimated demand of human resources can be predicted.
(e) Delphi Technique:Delphi technique is also very important technique used for estimating demand of human resources. This technique takes into consideration human resources requirements given by a group of experts i.e. mangers. The human resource experts collect the manpower needs, summarises the various responses and prepare a report. This process is continued until all experts agree on estimated human resources requirement.
(f) Other Techniques: The other techniques of Human Resources demand forecasting are specified as under:
(a) Following the techniques of demand forecasting of human resources used by other similar organisations
(b) Organisation-cum-succession-charts
(c) Estimation based on techniques of production
(d) Estimates based on historical records
(e) Statistical techniques e.g. co-relation and regression analysis.

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HR Supply Forecasting - succession analysis - Markov Analysis

Human Resource supply forecasting is the process of estimating availability of human resource followed after demand for testing of human resource. For forecasting supply of human resource we need to consider internal and external supply. Internal supply of human resource available by way of transfers, promotions, retired employees & recall of laid-off employees, etc. Source of external supply of human resource is availability of labour force in the market and new recruitment.
external supply of human resource depends on some factors mentioned below.
• Supply and demand of jobs.
• literacy rate of nation.
• rate of population
• industry and expected growth rate and levels
• technological development.
• compensation system based on education, experience, skill and age.
The most important techniques for forecasting of human resource supply are Succession analysis and Markov analysis.

Succession analysis

Once a company has forecast the demand for labour, it needs an indication of the firm's labour supply. Determining the internal labour supply calls for a detailed analysis of how many people are currently in various job categories or have specific skills within the organization. The planner then modifies this analysis to reflect changes expected in the near future as a result of retirements, promotions, transfers, voluntary turnover, and terminations.
Demand forecasting helps in determining the number and type of personnel/human resources required in future. The next step in human resource planning is forecasting supply of human resources. The purpose of supply forecasting is to determine the size and quality of present and potential human resources available from within and outside the organisation to meet the future demand of human resources. Supply forecast is the estimate of the number and kind of potential personnel that could be available to the organisation.

Estimating Internal Labor Supply for a Given Unit

The above figure illustrates that internal supply forecasting can be estimated based on the following:
(a) Current Staffing Level
(b) Projected Outflows This Year
(c) Projected Inflows This Year
Markov Analysis—transition probability matrix is developed to determine the probabilities of job incumbents remaining in their jobs for the forecasting period.
The technique is named after Russian mathematician Andrei Andreyevich Markov,
A transition matrix, or Markov matrix, can be used to model the internal flow of human resources. These matrices simply show as probabilities the average rate of historical movement from one job to another. Figure 2-12 presents a very simple transition matrix. For a line worker, for example, there is a 20% probability of being gone in 12 months, a 0% probability of promotion to manager, a 15% probability of promotion to supervisor, and a 65% probability of being a line worker this time next year. Such transition matrices form the bases for computer simulations of the internal flow of people through a large organization over time.

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Employee Motivation Introduction

According to Webster's New Collegiate Dictionary, a motive is "something (a need or desire) that causes a person to act." Motivate, in turn, means "to provide with a motive," and motivation is defined as "the act or process of motivating." Thus, motivation is the act or process of providing a motive that causes a person to take some action. In most cases motivation comes from some need that leads to behavior that results in some type of reward when the need is fulfilled. This definition raises a couple of basic questions.
The performance that employers look for in individuals rests on ability, motivation, and the support individuals receive; however, motivation is often the missing variable. Motivation is the desire within a person causing that person to act. People usually act for one reason: to reach a goal. Thus, motivation is a goal directed drive, and it seldom occurs in a void. The words need, want, desire, and drive are all similar to motive, from which the word motivation is derived. Understanding motivation is important because performance, reaction to compensation, and other HR concerns are related to motivation.

Motivation Defined

Internal and external factors that stimulate desire and energy in people to be continually interested in and committed to a job, role, or subject, and to exert persistent effort in attaining a goal.
Motivation results from the interactions among conscious and unconscious factors such as the
(1) intensity of desire or need,
(2) incentive or reward value of the goal, and
(3) expectations of the individual and of his or her significant others.
Many contemporary authors have also defined the concept of motivation. Motivation has been defined as: the psychological process that gives behavior purpose and direction (Kreitner, 1995); a predisposition to behave in a purposive manner to achieve specific, unmet needs (Buford, Bedeian, & Lindner, 1995); an internal drive to satisfy an unsatisfied need (Higgins, 1994); and the will to achieve (Bedeian, 1993). For this paper, motivation is operationally defined as the inner force that drives individuals to accomplish personal and organizational goals.
"Psychological forces that determine the direction of a person's behavior in an organization, a person's level of effort and a person's level of persistence." G. Jones and J. George from the book "Contemporary Management."
The following are the features of motivation :
• Motivation is an act of managers
• Motivation is a continuous process
• Motivation can be positive or negative
• Motivation is goal oriented
• Motivation is complex in nature
• Motivation is an art
• Motivation is system-oriented
• Motivation is different from job satisfaction

Why is motivation important?

Multi-generational Employee Motivation
The modern workforce now includes employees spanning three distinct generations. While all employees are inherently different despite age, differences between these generations do follow common themes– each has its own knowledge, strengths and weaknesses. Managers must know how to work with them all to maintain a successful business. If you understand a little bit about each group you will appreciate what motivates them to maximize their output, leading to fulfilling opportunities for everyone.
Baby Boomers
(Baby boomer is a term referring to a person who was born between 1946 and 1964.)
Economists predicted that this period would be partly defined by baby boomers retiring en masse. However, as a result of the recession, many have either elected or been forced to extend their careers. Their concerns about their financial future and desire to retire, therefore, should not be taken lightly.
Although they are loyal, if you want to keep hold of them make them feel valued. Their experience is invaluable, especially when you have a workforce full of enthusiastic, but often erratic millennials.
While they’re still around, take advantage of their strong management skills and work ethic to help train your younger employees. Facilitate the passing of knowledge between generations, but remember that baby boomers tend to be independent, so let them do so as they feel comfortable. You shouldn’t worry about giving them too much freedom – baby boomers tend to be overachievers.

Generation X

Gen X employees are technologically and internet-savvy, having seen modern technology introduced during their youth.
Many of this generation grew up without heavy parent supervision so as a result, also tend to be unafraid of working independently and taking risks. They’re also entrepreneurial so trust them to find inventive solutions to business problems and this will help your business’s agility in this ever-changing world.
However, GenX is the generation of instant gratification and they believe in a good work-life balance, so make sure they have the freedom to strike that balance or they will seek it elsewhere.

Generation Y

Apart from the baby boomers, GenY has been affected most by the recession. They make up the biggest proportion of the workforce, but also by far the biggest proportion of unemployed people in the US (48% in 2013).
They are pragmatic and hard-working, but they are jaded by the recent economic downturn and its effect on their job-search. They aren’t as loyal as previous generations and are open to new challenges. Provide ample opportunities in-house to progress or to further their education to avoid losing staff to your competitors.
In addition to personality differences, managers may have issues with the generational spread because they feel that this generation simply does not have the same set of skills as previous generations. 66% of businesses are still owned by Baby boomers, but most of their staff are statistically millennials and this clash of ideas and skills may cause conflict. Remember, a business’s expectations should be managed based on the makeup of its workforce as much as the whim of its owners.
People are a core business lever any successful business enjoys today. The soft aspects of the workplace, its employee engagement, culture, values, policies, etc. contribute significantly to attracting and retaining the best talent. And this study clearly points to the tremendous upside, which companies that effectively appreciate their employees can enjoy – a higher return on investments, equity and assets.
While most employees value appreciation at their workplace they don’t seem to get it quite often, only 41% employees feel they are appreciated at their current place of work, the study reveals.
Nearly 90% of India Inc. employees say they will stick around longer if they feel appreciated for their work reveals a study by TimesJobs. The study, which surveyed more than 1,600 employees, further reveals that 82% employees are willing to work harder if their bosses appreciate them.
Companies should ensure this by appreciating, recognising and rewarding your employees. It is a highly effective and proven strategy for improving employee engagement and business output. Therefore, creating a formal structure for employee recognition is very important
An industry-wise analysis shows that 87% IT, telecom, ITeS and internet employees don’t get much appreciation from their bosses. Nearly 75% employees in automobile sector and 70% in BFSI sector said no to any sort of appreciation from their bosses. However, manufacturing and retail sectors seem to be quite appreciative of their employees with 52% of its staff claiming there is enough appreciation from their bosses.
A gender-wise analysis shows that 85% male and 63% female employees feel there is not enough appreciation from their boss at work. While about 62% junior level, 80% middle level and 50% senior level employees claim a lack of appreciation at workplace.
Employers need to actively engage with their current and future employees, and positive reinforcements are the best way to ensure a powerful employer brand. Open, transparent and responsive communication both on formal and informal channels is key to success – active use of digital media, social networks and company reviews sites all play a major role in ensuring an attractive employer brand
70% employees feel acknowledged when given clear opportunities for promotion
It’s not a tough task to make employees feel valued at work. About 70% employees say that they feel appreciated if offered career advancement opportunities at their workplace. For 44% appreciation lies in regular rewards & recognitions, 37% find the best form of appreciation is in a pay raise while 22% feel valued when given a more challenging work profile, reveals the study.
Nearly 20% employees say they feel appreciated when allowed flexibility options, such as work from home & telecommuting. And 11% say more authority in decision-making makes them feel appreciated.
While a sustainable competitive advantage can be achieved by simply keeping employees happy, employers in India, have a long way to go, only 22% employees said they received appreciation every time they performed well last year, while 60% employees say they had rarely been appreciated for their good work last year. A further 18% stated they were never appreciated.
From the above analysis we can understand that majority of employees i.e. 70 percent gave priority to clear opportunities for promotion on career advancement opportunities. Only 37 percentage of employees bothered for pay hike.
Other interesting insights revealed in the Study -
On appreciation practices at their workplace:
• 52% feel their boss appreciates co-workers more
• 22% feel their boss appreciates employees who are new to the system
• 19% feel their boss appreciates employees who have more experience
• 7% feel their boss appreciates female workers more
On having a formal employee appreciation and recognition program:
63% employees say they have no such program at their workplace
37% employees say they have a formal rewards & recognition program in their company
On having a metrics to assess recognition efforts: 72% say there is no such measure for assessing recognition efforts in their company 28% say their company does not have an assessment mechanism in place for evaluating the impact of recognition efforts
By Varuni Khosla, ET Bureau|
Updated: Nov 02, 2016, 01.23 PM IST

Why is employee motivation important?

You can have a lovely shiny car, but it’s worthless if it doesn’t have the power of a great engine behind it. Your employees are the engines of your organization and like any finely tuned engine your workforce to operate smoothly and effectively. The fact is employee motivation is directly linked to business profits, and the more self-motivated your employees are, the more differentiated and successful you will be as a business.
• Motivated employees look for better ways to do a job.
• Motivated employees care about their customers
• Motivated employees take pride in their work.
• Motivated workers are more productive.

Motivating factors

motivating factors are drivers of the human behavior related to the intrinsic nature of the work, but not necessarily to the surrounding circumstances or environment. Motivating factors include achievement, advancement, autonomy, personal growth, recognition, responsibility, and the work itself.
The "Hawthorne effect" refers to improvements in worker productivity or quality that results from the mere fact that workers are being studied or observed. This observation came from studies carried out at Western Electric's Hawthorne plant during the late 1920s. The experiments validated the idea that people are motivated by additional factors rather than by purely economic factors.
Facts
Peter Drucker argued that people with highly developed skills or expertise can give their best only through self-motivation, not guidance from above. He forecast that with the rise of 'knowledge workers', firms would tend to become flatter. He was proved right.
Investment banks, which have a high concentration of knowledge workers, have very few levels.
"Corporate Meetings and Incentives" magazine is the senior executive's guide to decision-making. CMI explores trends in management, motivation, and incentives as they relate to how organizations successfully communicate with employees.

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[ 8 ]

Motivation Process

In its simplest form, the motivation process begins with a need, an individual’s perception of a deficiency. For instance, an employee might feel the need for more challenging work, for higher pay, for time off, or for the respect and admiration of colleagues. These needs lead to thought processes that guide an employee’s decision to satisfy them and to follow a particular course of action. If an employee’s chosen course of action results in the anticipated out come and reward, that person is likely to be motivated by the prospect of a similar reward to act the same way in the future. However, if the employee’s action does not result in the expected reward, he or she is unlikely to repeat the behavior. Thus, the reward acts as feedback mechanism to help the individual evaluate the consequences of the behavior when considering futures action.

Core Phases of the Motivational Process

1) Need Identification: First phase of motivation process is need identification where the employee feels his/her some unsatisfied need. The motivation process begins with an unsatisfied need, which creates tension and drives an individual to search for goals that, if attained, will satisfy the need and reduce the tension.
2) Searching Ways to satisfy needs: Second phase is finding the different alternatives that can be used to satisfy the needs, which were felt in first stage. These needs lead to thought processes that guide an employee’s decision to satisfy them and to follow a particular course of action
3) Selecting Goals: Once if the need is assessed and employee is able to find out the way to satisfy the need than next phase is selection of goals to be performed.
4) Employee Performance: These needs lead to thought processes that guide an employee’s decision to satisfy them and to follow a particular course of action in form of performance.
5) Consequences of performance Reward/punishments: If an employee’s chosen course of action results in the anticipated out come and reward, that person is likely to be motivated by the prospect of a similar reward to act the same way in the future. However, if the employee’s action does not result in the expected reward, he or she is unlikely to repeat the behavior
6) Reassessment of Need deficiencies: Once felt need is satisfied through certain rewards in response to performance than employee reassesses any deficiencies and entire process is repeated again.

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Theories of Motivation

Motivation theories seek to explain why employees are motivated by and satisfied with one type of work than another. It is essential that mangers have a basic understanding of work motivation because highly motivated employees are more likely to produce a superior quality product or service than employee who lack motivation.
At one time, employees were considered just another input into the production of goods and services. What perhaps changed this way of thinking about employees was research, referred to as the Hawthorne Studies, conducted by Elton Mayo from 1924 to 1932 (Dickson, 1973). This study found employees are not motivated solely by money and employee behavior is linked to their attitudes (Dickson, 1973). The Hawthorne Studies began the human relations approach to management, whereby the needs and motivation of employees become the primary focus of managers (Bedeian, 1993).

Theories of Motivation by various researchers

1. Maslow’s Need Hierarchy
2. Existence Relatedness Growth (ERG) Theory
3. McGregor’s Theory-X and Theory-Y
4. Expectancy Theory
5. Reinforcement Theory
6. Herzberg two factor theory
7. McClelland (Needs for Affiliation, Power, and Achievement) Theory of Motivation
8. Adam’s Equity Theory

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Maslow’s Need Hierarchy

Maslow's Hierarchy of Needs Theory

In the year 1943 a Psychologist Maslow suggested his Theory of Human Motivation. His theory is one popular and extensively cited theory of human motivation. Maslow's theory is based on Hierarchy of Human Needs. According to Maslow, human behavior is related to his needs. It is adjusted as per the nature of needs to be satisfied. In hierarchy of needs theory of motivation, Maslow identified five types / sets of human need arranged in a hierarchy of their importance and priority. He concluded that when one set of needs is satisfied, it ceases to be a motivating factor. Thereafter, the next set of needs in the hierarchy order takes its place. These needs in hierarchy can be compared to a pyramid. At the lowest level, there will be first set of needs which can be described as basic needs or Physiological needs and are universal in character. This will be followed by other sets of needs.
Abraham Maslow organized five major types of human needs into a hierarchy, as shown in Figure. The need hierarchy illustrates Maslow’s conception of people satisfying their needs in a specified order, from bottom to top. The needs, in ascending order, are:
1. Physiological needs
2. Safety needs
3. Love belonging
4. Self-Esteem
5. Self-actualization

Physiological Needs :

The Physiological needs are the basic needs for sustaining the human life. These needs include food, clothing, shelter, rest, water, air, sleep and sexual satisfaction. These basic human needs (also called as biological needs) lie at the lowest level in the hierarchy of needs as they have priority over all other needs. These needs cannot be postponed for long time. Unless and until these basic physiological needs are satisfied to the required extent, other needs do not motivate an person/employee. A hungry person, for example, is just not in a position to think of anything else except his hunger or food. According to Maslow, 'man lives by bread alone,' when there is no bread. The management attempts to meet such physiological needs through payment of fair wages.
Facts
One-third of food produced globally every year does not reach human mouths, it is either lost in transit or wasted by consumers themselves. This amounts to a staggering 1.3 billion tonnes every year. These chilling figures are contained in a report called 'Avoiding Future Famines' released by the United Nations Environment Programme held at Rio+20 summit on sustainable development.
'Americans throw away 25% of food'

Security / Safety Needs :

These are the needs connected with psychological fear of loss of job, property, natural calamities or hazards, etc. An employee wants and needs protection from such types of fear. He prefers adequate safety and security in this regard i.e. protection from physical danger, security of job, pension at old age, insurance coverage for life, etc. The safety needs come after meeting the physiological needs. Such physiological needs lose their motivational potential when they are satisfied. As a result, safety needs replaces them. They begin to manifest themselves and dominate the human behavior. Safety needs act as motivational forces only if they are unsatisfied.
Facts
A job satisfaction study compiled by CareerJournal.com asked satisfied workers to describe their jobs. The study found that highly satisfied employees consistently listed four factors: intellectual stimulation, job security, high levels of control and autonomy, and direct contact with clients and customers.
Demographers have labeled the generation born from 1982 to 2000 as "Millennials". Millennials were raised in a climate of high self-esteem, rapid changes in technology, and more focus on lifestyle. They are taking longer to finish school, launch careers, get married and form families. In the workplace, millennials may challenge traditional corporate boundaries more than previous generations.

Social Needs/Love belonging :

An employee is a human being is rightly treated as social animal. He desires or likes to stay in group. Human being feels that he should belong to one or the other group and the member of the group should accept him with the love and affection. Every human being desires to be affiliated to such groups. This is treated as basic social need of an individual. He also feels that he should be loved by the other persons. He needs friends and interaction with his friends and superiors of the group such as fellow employees or his superiors. Social needs occupy third position in the hierarchy of needs.

Esteem Needs :

This category of needs include the need to be respected by others, need to be appreciated by others, need to have the power and finally prestigious position. Once the previous needs are satisfied, a human being feels to be held in esteem both by himself and also by others. Thus, esteem needs are two fold in nature. Self esteem needs include those for self confidence, self-respect, competence, etc. The second groups of esteem needs are those related to one's status, reputation, recognition and appreciation by others. This is a type of personal ego which needs to be satisfied. The Organisation can satisfy this need (ego) by giving recognition to the good work of employees in organisation. Esteem needs do not assume the motivational properties unless the previous needs are satisfied.
"Recognition is like a small drop of oil in the machinery of business. It just makes things run a little smoother." -– Obert Tanner
Giving recognition makes employees confident in work: Report
Even as receiving recognition is the usual norm, many organisations are now opening channels for employees to give regular recognition to their co-workers and 90 per cent respondents said by doing so they feel more confident in their work, a report has said."Those who give recognition at work are more confident in their work. About 90 per cent of employees who noted that they always give recognition to employees feel that their work in the past 12 months has represented significant innovations," according to a OC Tanner report.
The report also revealed that 94 per cent of employees noted that they always give recognition to co-workers are proud to tell others they work for their organisation.OC Tanner conducted the study among 3,496 employees, who were over 18 years working full-time at companies with more than 500 workforce, in multiple countries across four continents, including the US, the UK, Canada, Australia, India, Singapore and Germany."Creating opportunities for giving, receiving and observing recognition, and devising a programme that focuses on all three, will help organisations increase employee engagement, wellbeing, innovation, work results and revenue," the report said. It said by giving recognition more often, employees not only feel more secure in their present circumstances, but are also more optimistic about their future.
• The report said that about 89 per cent agree that giving recognition creates a better company culture, while 79 said the giver works harder after they recognise another's achievement.
• 75 per cent respondents felt that giving recognition makes them want to stay at their current organisation longer.
• The report said 86 per cent agreed that giving recognition helped them better connect with their colleagues and 81 per cent felt it made them better connect to their organisations.
• Overall, the report has revealed that employees in the US and the UK give recognition at a higher rate than other countries.
• Australian, Canadian, and German employees fall in the middle range and while employees in the Asian countries of India and Singapore give recognition the least, it added.
Facts
A recent poll of over 1,000 full-time employees by Maritz Research found over half believed the quality of their company's recognition efforts impacted their job performance. Respondents who were "completely satisfied" with their employer's recognition programs were more satisfied with their jobs, more likely to remain with the company, and more likely to recommend their workplace to others

Self-actualisation Needs :

This is the highest among the needs in the hierarchy of needs advocated by Abraham Maslow. Self actualisation is the desire to become what one is capable of becoming. It is the 'growth' need. A worker must work efficiently if he is to be ultimately happy. Here, a person feels that he should accomplish something in his life. Human want to utilise his potentials to the maximum extent and desires to become what one is capable of becoming. A person desires to have challenges and achieves something special in his life or in the area of his specialization. Though every one is capable of self-actualization, many do not reach this stage. This need is fully satisfied rarely.

How does the Hierarchy Work?

• A person starts at the bottom of the hierarchy (pyramid) and will initially seek to satisfy basic needs (e.g. food,clothing and shelter)
• Once these physiological needs have been satisfied, they are no longer a motivator. the individual moves up to the next level
• Safety needs at work could include physical safety (e.g. protective clothing) as well as protection against unemployment, loss of income through sickness etc)
• Social needs recognise that most people want to belong to a group. These would include the need for love and belonging (e.g. working with colleague who support you at work, teamwork, communication)
• Esteem needs are about being given recognition for a job well done. They reflect the fact that many people seek the esteem and respect of others. A promotion at work might achieve this.
• Self-actualisation is about how people think about themselves - this is often measured by the extent of success and/or challenge at work
Maslow's model has great potential appeal in the business world. The message is clear - if management can find out which level each employee has reached, then they can decide on suitable rewards.

Implications for Management

If Maslow's theory holds, there are some important implications for management. There are opportunities to motivate employees through management style, job design, company policies, and compensation packages, some examples of which follow:
• Physiological needs: Provide lunch breaks, rest breaks, and wages that are sufficient to purchase the essential goods for human life.
• Safety Needs: Provide a safe working environment, retirement benefits, and the job security.
Indians prefer long-term job security over salary: Survey
April, 2012: With the market uncertainty, Indian employees are preferring financially healthy companies and long-term job security, a survey says. Long-term job security and financial health of the company are the most-often selected factors by 64 per cent employees, followed by career progression opportunities (50 per cent), says a recent Randstad India report.
Salary and employee benefits, which topped the chart in 2011, has dropped to the third position, it adds. Long-term job security seems to be the top preference in the telecom sector, but not in the automotive sector.
• Social Needs: Create a sense of community via team-based projects and social events.
• Esteem Needs: Recognize achievements to make employees feel appreciated and valued. Offer job titles that convey the importance of the position.
• Self-Actualization: Provide employees a challenge and the opportunity to reach their full career potential and achieve top positions in their life.
However, not all people are driven by the same needs - at any time different people may be motivated by entirely different factors. It is important to understand the needs being pursued by each employee. To motivate an employee, the manager must be able to recognize the needs level at which the employee is operating, and use those needs as levers of motivation.

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[ 11 ]

Existence Relatedness Growth (ERG) Theory

Clayton P. Alderfer

Clayton Paul Alderfer (born September 1, 1940 in Sellersville, Pennsylvania) is an American psychologist who further expanded Maslow's hierarchy of needs by categorizing the hierarchy into his ERG theory (Existence, Relatedness and Growth).
The ERG Theory of Clayton P. Alderfer is a model that appeared in 1969 in a Psychological Review article entitled "An Empirical Test of a New Theory of Human Need". In a reaction to the famous Hierarchy of Needs by Maslow, Alderfer distinguishes three categories of human needs that influence worker's behavior; existence, relatedness and growth.

The ERG Categories Of Human Needs

These ERG Theory categories are:
• Existence Needs: physiological and safety needs (such as hunger, thirst and sex). The first two levels ofMaslow.
• Relatedness Needs: social and external esteem (involvement with family, friends, co-workers and employers). The third and fourth levels of Maslow.
• Growth Needs: internal esteem and self actualization (the desire to be creative, productive and to complete meaningful tasks). Maslow's fourth and fifth levels.

ERG Theory And Maslow

Contrarily to the idea by Maslow that access to the higher levels of his pyramid required satisfaction in the lower level needs, the ERG areas of Alderfer are simultaneous needs.
ERG Theory recognizes that the importance of the three categories may vary for each individual. Managers must recognize that an employee has multiple needs, which must be satisfied simultaneously. According to the ERG theory, if you focus exclusively on one need at a time, this will not effectively motivate.

The Frustration-Regression Principle

In addition, the ERG theory acknowledges that if a higher level need remains unfulfilled, the person may regress towards lower level needs, which appear easier to satisfy. This is known as: the frustration-regression principle. This principle impacts workplace motivation. For example, if growth opportunities are not offered to the employees, they may regress towards relatedness needs, and socialize more with co-workers.
If management can recognize these conditions early, steps can be taken to satisfy the frustrated needs until the subordinate is able to pursue growth again.

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McGregor’s Theory-X and Theory-Y

This question of motivation has been studied by management theorists and social psychologists for decades, in attempts to identify successful approaches to management.

Douglas Murray McGregor

Social psychologist McGregor’s Theory-X and Theory-Yof MIT expounded two contrasting theories on human motivation and management in the 1960s: The X Theory and the Y Theory. McGregor promoted Theory Y as the basis of good management practice, pioneering the argument that workers are not merely cogs in the company machinery, as Theory X-Type organizations seemed to believe.
The theories look at how a manager's perceptions of what motivates his or her team members affects the way he or she behaves. By understanding how your assumptions about employees’ motivation can influence your management style, you can adapt your approach appropriately, and so manage people more effectively.

Understanding the Theories

Your management style is strongly influenced by your beliefs and assumptions about what motivates members of your team: If you believe that team members dislike work, you will tend towards an authoritarian style of management; On the other hand, if you assume that employees take pride in doing a good job, you will tend to adopt a more participative style.

Theory X

Theory X assumes that employees are naturally unmotivated and dislike working, and this encourages an authoritarian style of management. According to this view, management must actively intervene to get things done. This style of management assumes that workers:
• Dislike working.
• Avoid responsibility and need to be directed.
• Have to be controlled, forced, and threatened to deliver what's needed.
• Need to be supervised at every step, with controls put in place.
• Need to be enticed to produce results; otherwise they have no ambition or incentive to work.
X-Type organizations tend to be top heavy, with managers and supervisors required at every step to control workers. There is little delegation of authority and control remains firmly centralized.
McGregor recognized that X-Type workers are in fact usually the minority, and yet in mass organizations, such as large scale production environment, X Theory management may be required and can be unavoidable.

Theory Y

Theory Y expounds a participative style of management that is de-centralized. It assumes that employees are happy to work, are self-motivated and creative, and enjoy working with greater responsibility. It assumes that workers:
• Take responsibility and are motivated to fulfill the goals they are given.
• Seek and accept responsibility and do not need much direction.
• Consider work as a natural part of life and solve work problems imaginatively
This more participative management style tends to be more widely applicable. In Y-Type organizations, people at lower levels of the organization are involved in decision making and have more responsibility.

Comparing Theory X and Theory Y

Motivation
Theory X assumes that people dislike work; they want to avoid it and do not want to take responsibility. Theory Y assumes that people are self-motivated, and thrive on responsibility.
Management Style and Control
In a Theory X organization, management is authoritarian, and centralized control is retained, whilst in Theory Y, the management style is participative: Management involves employees in decision making, but retains power to implement decisions.
Work Organization
Theory X employees tend to have specialized and often repetitive work. In Theory Y, the work tends to be organized around wider areas of skill or knowledge; Employees are also encouraged to develop expertise and make suggestions and improvements.
Rewards and Appraisals
Theory X organizations work on a ‘carrot and stick’ basis, and performance appraisal is part of the overall mechanisms of control and remuneration. In Theory Y organizations, appraisal is also regular and important, but is usually a separate mechanism from organizational controls. Theory Y organizations also give employees frequent opportunities for promotion.
Application
Although Theory X management style is widely accepted as inferior to others, it has its place in large scale production operation and unskilled production-line work. Many of the principles of Theory Y are widely adopted by types of organization that value and encourage participation. Theory Y-style management is suited to knowledge work and professional services. Professional service organizations naturally evolve Theory Y-type practices by the nature of their work; Even highly structure knowledge work, such as call center operations, can benefits from Theory Y principles to encourage knowledge sharing and continuous improvement.

Theory X and Theory Y in the Twenty-First Century

McGregor's work on Theory X and Theory Y has had a significant impact on management thought and practice in the years since he first articulated the concepts. In terms of the study of management, McGregor's concepts are included in the overwhelming majority of basic management textbooks, and they are still routinely presented to students of management. Most textbooks discuss Theory X and Theory Y within the context of motivation theory; others place Theory X and Theory Y within the history of the organizational humanism movement.
Theory X and Theory Y are often studied as a prelude to developing greater understanding of more recent management concepts, such as job enrichment, the job-characteristics model, and self-managed work teams. Although the terminology may have changed since the 1950s, McGregor's ideas have had tremendous influence on the study of management.
In terms of the practice of management, the workplace of the early twenty-first century, with its emphasis on self-managed work teams and other forms of worker involvement programs, is generally consistent with the precepts of Theory Y. There is every indication that such programs will continue to increase, at least to the extent that evidence of their success begins to accumulate.

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[ 13 ]

Expectancy Theory

The expectancy theory says that individuals have different sets of goals and can be motivated if they have certain expectations. This theory is about choice, it explains the processes that an individual undergoes to make choices. In organizational behavior study, expectancy theory is a motivation theory first proposed by Victor Vroom of the Yale School of Management in 1964.

Motivation of Employees

Motivation, according to Vroom. boils down to the decision of how much effort to apply in a specific task situation. This choice is based on a two-stage sequence of expectations (effort —> performance and performance —> outcome). First, motivation is affected by an individual's expectation that a certain level of effort will produce the intended performance goal. For example, if you do not believe increasing the amount of time you spend studying will significantly raise your grade on an exam, you probably wilt not study any harder than usual. Motivation also is influenced by the employee's perceived chances of getting various outcomes as a result of accomplishing his or her performance goal. Finally, individuals are motivated to the extent that they value the outcomes received.
Vroom used a mathematical equation to integrate these concepts into a predictive model of motivational force or strength. For our purposes, however, it is sufficient to define and explain the three key concepts within Vroom's model—expectancy, instrumentality, and valence.
The expectancy theory says that individuals have different sets of goals and can be motivated if they have certain expectations.

Expectancy Theory Expectations

• There is a positive correlation between efforts and performance,
• Favorable performance will result in a desirable reward,
• The reward will satisfy an important need,
• he desire to satisfy the need is strong enough to make the effort worthwhile. Vroom's Expectancy Theory is based upon the following three beliefs.
Expectancy Theory Beliefs
1. Valence. Refers to the emotional orientations which people hold with respect to outcomes (rewards). The depth of the want of an employee for extrinsic (money, promotion, free time, benefits) or intrinsic (satisfaction) rewards. Management must discover what employees appreciate.
2. Expectancy. Employees have different expectations and levels of confidence about what they are capable of doing. Management must discover what resources, training, or supervision the employees need.
Facts
The 2011 Nielsen survey also showed that the top five dimensions students considered when it comes to seeking employment were high degree of independence at work, salary package, learning on the job, growth prospects and standing of the company in the market (Employer brand) respectively.
3. Instrumentality. The perception of employees whether they will actually receive what they desire, even if it has been promised by a manager. Management must ensure that promises of rewards are fulfilled and that employees are aware of that.
Vroom suggests that an employee's beliefs about Expectancy, Instrumentality, and Valence interact psychologically. In this way they create a motivational force, such that the employee will act in a way that brings pleasure and avoids pain. This force can be 'calculated' via a formula:

Expectancy Theory Formula

Motivation = valence x Expectancy (instrumentality)
This formula can be used to indicate and predict things as: job satisfaction, occupational choice, the likelihood of staying in a job, and the effort that one might expend at work.

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[ 14 ]

Reinforcement Theory

In 1911, psychologist Edward Thorndike formulated the law effect: Behavior that is followed by positive consequences probably will be repeated. This powerful law of behavior laid the foundation for country investigations into the effects of the positive consequences, called rein forcers that motivate behavior. Organizational behavior modification attempts to people’s actions. Four key consequences of behavior either encourage or discourage people’s behavior

Positive Reinforcement:-

applying a valued consequence that increases the likelihood that the person will repeat the behavior that led to it. Examples of positive reinforcers include compliments, letters of commendation, favorable performance evaluations, and pay raises. Equally important, jobs can be positively reinforcing. Performing well on interesting, challenging, or enriched jobs (discussed later in this chapter) is much more reinforcing, and therefore motivating, then performing well on jobs that are routine and monotonous.
Facts
The 2011 Nielsen survey also showed that the top five dimensions students considered when it comes to seeking employment were high degree of independence at work, salary package, learning on the job, growth prospects and standing of the company in the market (Employer brand) respectively.

Negative Reinforcement:-

removing or withholding an undesirable consequence. For example, a manager takes an employee (or a school takes a student) off probation because of improved performance. Frequent threatening memos admonished people to achieve every one of their many performance goals

Punishment:-

administering an aversive consequence. Examples include criticizing or shouting at an employee, assigning an unappealing task, and sending a worker home without pay. Negative reinforcement can involve the threat of punishment, but not delivering it when employees perform satisfactorily. Punishment is the actual delivery of the aversive consequence.

Extinction: –

withdrawing or failing or failing to provide a reinforcing consequence. When this occurs motivation is reduced and the behavior is extinguished, or eliminated. Examples include not giving a compliment for a job well done, forgetting to say thanks for a favor, or setting impossible performance goals so that the person never experiences success. The first two consequences, positive and negative reinforcement, are positive for the person receiving them: The person either gains something or avoids something negative. Therefore, the person who experiences these consequences will be motivated to behave in the ways that led to the reinforcement. The last two consequences, punishment and extinction, are negative outcomes for the person receiving them: Motivation to repeat the behavior that led to the undesirable results will be reduced.
Thus, effective managers give positive reinforcement to their high-performing people and negative reinforcement to low performance. They also punish or extinguish poor performance and other unwanted behavior.

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[ 15 ]

Herzberg two factor theory

Frederick Irving Herzberg

Herzberg's Two Factor Theory is a "content theory" of motivation" (the other main one is Maslow's Hierarchy of Needs).
Herzberg analysed the job attitudes of 200 accountants and engineers who were asked to recall when they had felt positive or negative at work and the reasons why.
In 1959, Frederick Herzberg, a behavioural scientist proposed a two-factor theory or the motivator-hygiene theory. According to Herzberg, there are some job factors that result in satisfaction while there are other job factors that prevent dissatisfaction. According to Herzberg, the opposite of “Satisfaction” is “No satisfaction” and the opposite of “Dissatisfaction” is “No Dissatisfaction”.

Hygiene factors

Hygiene factors are those job factors which are essential for existence of motivation at workplace. These do not lead to positive satisfaction for long-term. But if these factors are absent / if these factors are non-existant at workplace, then they lead to dissatisfaction. In other words, hygiene factors are those factors which when adequate / reasonable in a job, pacify the employees and do not make them dissatisfied.These factors are extrinsic to work. Hygiene factors are also called as dissatisfiers or maintenance factors as they are required to avoid dissatisfaction. These factors describe the job environment / scenario. The hygiene factors symbolized the physiological needs which the individuals wanted and expected to be fulfilled. Hygiene factors include:
1. Pay- The pay or salary structure should be appropriate and reasonable. It must be equal and competitive to those in the same industry in the same domain.
2. Company Policies and administrative policies- The company policies should not be too rigid. They should be fair and clear. It should include flexible working hours, dress code, breaks, vacation, etc.
3. Fringe benefits- The employees should be offered health care plans (mediclaim), benefits for the family members, employee help programmes, etc.
4. Physical Working conditions- The working conditions should be safe, clean and hygienic. The work equipments should be updated and well-maintained.
5. Status- The employees’ status within the organization should be familiar and retained.
6. Interpersonal relations-The relationship of the employees with his peers, superiors and subordinates should be appropriate and acceptable. There should be no conflict or humiliation element present.
7. Job Security- The organization must provide job security to the employees.
Indians prefer long-term job security over salary: Survey
April, 2012: With the market uncertainty, Indian employees are preferring financially healthy companies and long-term job security, a survey says. Long-term job security and financial health of the company are the most-often selected factors by 64 per cent employees, followed by career progression opportunities (50 per cent), says a recent Randstad India report.
Salary and employee benefits, which topped the chart in 2011, has dropped to the third position, it adds. Long-term job security seems to be the top preference in the telecom sector, but not in the automotive sector.
It is not just a matter of High pay packages anymore as majority of Indian employees are willing to compromise on salary provided they have job security and pleasant colleagues at work place, says a survey.
Job insecurity creates dissatisfaction: Study
MADRID (Spain): Fears of losing a job erodes commitment to work, besides casting a shadow over many areas of life, including family, health, finances and leisure, a study reveals.
As the fear of unemployment increases, "the level of work insecurity rises, people are less satisfied with their personal, work and family lives and they are less committed to their work," said Amparo Caballer, psychology researcher at the University of Valencia, who co-authored the study.
This analysis also reveals that the consequences of job insecurity are different in each occupational group, the Spanish Journal of Psychology reported.
Three different groups have been identified: blue collar workers, white collar workers and 'professionals'. The first group included people with positions that do not need high qualifications, such as supermarket shelf-fillers or hospital attendants, according to a university statement.
The second group includes office and administration workers and supermarket assistants and check-out staff. The 'professionals' group includes doctors, engineers and nurses.
When there is uncertainty about employment, blue collar workers "are less satisfied with life and they work less productively than the other groups studied", Caballer explained.
White collar workers are the ones who display the most dissatisfaction at times of instability. Upon examining the results of the study, not all employees react to insecurity in the same way. Some groups are more prone to react more negatively to perceiving insecurity at work.
Therefore, the study authors advise against approaching the problems in the same way as with different groups in the company.
The data was based on 321 worker's answers to a questionnaire, which includes 51.4 percent people who worked in hospitals, 25.7 percent had positions in supermarts and commercial distribution companies and 22.9 percent were temporary work agency employees.

Motivational factors

According to Herzberg, the hygiene factors cannot be regarded as motivators. The motivational factors yield positive satisfaction. These factors are inherent to work. These factors motivate the employees for a superior performance. These factors are called satisfiers. These are factors involved in performing the job. Employees find these factors intrinsically rewarding. The motivators symbolized the psychological needs that were perceived as an additional benefit. Motivational factors include:
• Recognition- The employees should be praised and recognized for their accomplishments by the managers.
A recent poll of over 1,000 full-time employees by Maritz Research found over half believed the quality of their company's recognition efforts impacted their job performance. Respondents who were "completely satisfied" with their employer's recognition programs were more satisfied with their jobs, more likely to remain with the company, and more likely to recommend their workplace to others.
Giving recognition makes employees confident in work: Report
Even as receiving recognition is the usual norm, many organisations are now opening channels for employees to give regular recognition to their co-workers and 90 per cent respondents said by doing so they feel more confident in their work, a report has said."Those who give recognition at work are more confident in their work. About 90 per cent of employees who noted that they always give recognition to employees feel that their work in the past 12 months has represented significant innovations," according to a OC Tanner report.
The report also revealed that 94 per cent of employees noted that they always give recognition to co-workers are proud to tell others they work for their organisation.OC Tanner conducted the study among 3,496 employees, who were over 18 years working full-time at companies with more than 500 workforce, in multiple countries across four continents, including the US, the UK, Canada, Australia, India, Singapore and Germany."Creating opportunities for giving, receiving and observing recognition, and devising a programme that focuses on all three, will help organisations increase employee engagement, wellbeing, innovation, work results and revenue," the report said. It said by giving recognition more often, employees not only feel more secure in their present circumstances, but are also more optimistic about their future.
• The report said that about 89 per cent agree that giving recognition creates a better company culture, while 79 said the giver works harder after they recognise another's achievement.
• 75 per cent respondents felt that giving recognition makes them want to stay at their current organisation longer.
• The report said 86 per cent agreed that giving recognition helped them better connect with their colleagues and 81 per cent felt it made them better connect to their organisations.
• Overall, the report has revealed that employees in the US and the UK give recognition at a higher rate than other countries.
• Australian, Canadian, and German employees fall in the middle range and while employees in the Asian countries of India and Singapore give recognition the least, it added.
• Sense of achievement- The employees must have a sense of achievement. This depends on the job. There must be a fruit of some sort in the job.
• Growth and promotional opportunities- There must be growth and advancement opportunities in an organization to motivate the employees to perform well.
Facts
The 2011 Nielsen survey also showed that the top five dimensions students considered when it comes to seeking employment were high degree of independence at work, salary package, learning on the job, growth prospects and standing of the company in the market (Employer brand) respectively.
• Responsibility- The employees must hold themselves responsible for the work. The managers should give them ownership of the work. They should minimize control but retain accountability.
• Meaningfulness of the work- The work itself should be meaningful, interesting and challenging for the employee to perform and to get motivated.

Applying Hertzberg's model to de-motivated workers

What might the evidence of de-motivated employees be in a business?
• Low productivity
• Poor production or service quality
• Strikes / industrial disputes / breakdowns in employee communication and relationships
• Complaints about pay and working conditions
According to Herzberg, management should focus on rearranging work so that motivator factors can take effect. He suggested three ways in which this could be done:

Maslow’s and Herzberg’s Ideas Compared

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[ 16 ]

McClelland (Needs for Affiliation, Power, and Achievement) Theory of Motivation

McClelland (1961)

David McClelland and his associates proposed McClelland’s theory of Needs / Achievement Motivation Theory. This theory states that human behaviour is affected by three needs - Need for Power, Achievement and Affiliation.
Need for achievement is the urge to excel, to accomplish in relation to a set of standards, to struggle to achieve success.
Need for power is the desire to influence other individual’s behaviour as per your wish. In other words, it is the desire to have control over others and to be influential.
Need for affiliation is a need for open and sociable interpersonal relationships. In other words, it is a desire for relationship based on co-operation and mutual understanding.
The individuals with high achievement needs are highly motivated by competing and challenging work. They look for promotional opportunities in job. They have a strong urge for feedback on their achievement. Such individuals try to get satisfaction in performing things better. High
achievement is directly related to high performance. Individuals who are better and above average performers are highly motivated. They assume responsibility for solving the problems at work. McClelland called such individuals as gamblers as they set challenging targets for themselves and they take deliberate risk to achieve those set targets. Such individuals look for innovative ways of performing job. They perceive achievement of goals as a reward, and value it more than a financial reward.
The individuals who are motivated by power have a strong urge to be influential and controlling. They want that their views and ideas should dominate and thus, they want to lead. Such individuals are motivated by the need for reputation and self-esteem. Individuals with greater power and authority will perform better than those possessing less power. Generally, managers with high need for power turn out to be more efficient and successful managers. They are more determined and loyal to the organization they work for. Need for power should not always be taken negatively. It can be viewed as the need to have a positive effect on the organization and to support the organization in achieving it’s goals.
The individuals who are motivated by affiliation have an urge for a friendly and supportive environment. Such individuals are effective performers in a team. These people want to be liked by others. The manager’s ability to make decisions is hampered if they have a high affiliation need as they prefer to be accepted and liked by others, and this weakens their objectivity. Individuals having high affiliation needs prefer working in an environment providing greater personal interaction. Such people have a need to be on the good books of all. They generally cannot be good leaders.

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[ 17 ]

Adam’s Equity Theory

Equity theory, most popularly known as equity theory of motivation, was first developed by John Stacey Adams, a workplace and behavioral psychologist, in 1963.
John Stacey Adams proposed that an employee’s motivation is affected by whether the employee believes that their employment benefits/rewards are at least equal to the amount of the effort that they put into their work.

Definition of equity

An individual will consider that he is treated fairly if he perceives the ratio of his inputs to his outcomes to be equivalent to those around him. Thus, all else being equal, it would be acceptable for a more senior colleague to receive higher compensation, since the value of his experience (and input) is higher. The way people base their experience with satisfaction for their job is to make comparisons with themselves to people they work with. If an employee notices that another person is getting more recognition and rewards for their contributions, even when both have done the same amount and quality of work, it would persuade the employee to be dissatisfied. This dissatisfaction would result in the employee feeling under-appreciated and perhaps worthless. This is in direct contrast with the idea of equity theory, the idea is to have the rewards (outcomes) be directly related with the quality and quantity of the employees contributions (inputs). If both employees were perhaps rewarded the same, it would help the workforce realize that the organization is fair, observant, and appreciative.
This can be illustrated by the following equation:

Adam’s categorised employment benefits and rewards as outputs and an employee’s work effort as inputs.
Input Examples
• The number of hours worked by the employee
• An employee’s work responsibilities
• An employee’s work duties
• The work commitment demonstrated by the employee
• An employee’s loyalty
• An employee’s flexibility such as undertaking tasks at short notice
• The support that the employee has provided to the organisation, colleagues and line managers
Output Examples
• Salary
• Bonus
• Prizes
• Recognition of the employee’s contribution
• Positive work appraisals
• Work promotions
• Pension
• Employer flexibility
• Annual leave
Adam’s stated that if an employee believes that their work outputs are not equal or greater than their inputs then the employee will become de-motivated. Adams’ theory includes the assertion that when an employee is assessing whether the outputs they receive are fair the employee will often compare their colleague’s work inputs and outputs with their own. The comparison will often be made with an employee at a similar level in the organisation to the employee.
Facts
The 2011 Nielsen survey also showed that the top five dimensions students considered when it comes to seeking employment were high degree of independence at work, salary package, learning on the job, growth prospects and standing of the company in the market (Employer brand) respectively.

Propositions

Equity theory consists of four propositions:
1. Individuals seek to maximize their outcomes (where outcomes are defined as rewards minus costs).
2. Groups can maximize collective rewards by developing accepted systems for equitably apportioning rewards and costs among members. Systems of equity will evolve within groups, and members will attempt to induce other members to accept and adhere to these systems. The only way groups can induce members to equitably behave is by making it more profitable to behave equitably than inequitably. Thus, groups will generally reward members who treat others equitably and generally punish (increase the cost for) members who treat others inequitably.
3. When individuals find themselves participating in inequitable relationships, they become distressed. The more inequitable the relationship, the more distress individuals feel. According to equity theory, both the person who gets “too much” and the person who gets “too little” feel distressed. The person who gets too much may feel guilt or shame. The person who gets too little may feel angry or humiliated.
4. Individuals who perceive that they are in an inequitable relationship attempt to eliminate their distress by restoring equity. The greater the inequity, the more distress people feel and the more they try to restore equity. (Walster, Traupmann and Walster, 1978)

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[ 18 ]

Methods for Motivating Employees for Employee Satisfaction

1.Rewards:

People behave in ways that they believe are in their best interest, they constantly look for payoffs for their efforts. They expect good job performance to lead to organizational goal attainment, which in turn leads to satisfying their individual goals or needs. Organization, then, use rewards to motivate people.
Facts
A recent Money Magazine and Salary.com survey of 26,000 workers found that workers who considered themselves extremely satisfied with their jobs were putting in a lot more time at work than others. The most satisfied group in the survey reported eleven more weekly work hours than the least satisfied group. Generally, as satisfaction rose, workers reported longer hours worked.
Height of Reward for Motivation : Source: Nov-11-2012 TOI
Jaipur (India): Jaipur traffic police officials decided to motivate a group of eight hardworking police by paying them Rs.11 (0.20$) as a bonus for motivation and appreciation. This has made group to surprise and left them in a state of question of motivation or humiliation for their hardwork done. A police from group of eight who rejected to disclose his name, expressed his extreme dissatisfaction and actually felt humiliated and demotivated. Same of group of eight said that this is not first experience to them, earlier they got cash price of Rs. 51 (1$) for solving serious crimes like recovering stolen vehicle.
Despite of this sort of cash reward, one police official said that amount is not a criteria.
Who ever puts his efforts in discharging his duties and does hard-work in his job, its human tendency expects some sort of motivation in return, which same was expressed by victor Vroom in his expectancy theory of motivation.

2. Challenging Jobs:

Job design refers to the number and nature of activities in a job. The key issue is whether jobs should be more specialized or more enriched and non-routine. Job design has been implemented in several ways. Job enlargement assigns workers to additional same-level tasks to increase the number of tasks they have to perform. Job rotation systematically moves workers from job to job. Job enrichment means building motivators like opportunities for achievement into the job by making it more interesting and challenging. Forming natural work groups, combining tasks, establishing client relationships, vertically loading the job, and having open feedback channels may implement Job enrichment.

3. Using Merit Pay:

A merit raise is a salary increase, usually permanent, that is based on the employee’s individual performance. It is a continuing increment rather than a single payment like a bonus. Relying heavily on merit rewards can be a problem because the reinforcement benefits of merit pay is usually only determined once per year.

4. Using Spot Awards:

A spot award is one given to an employee as soon as the laudable performance is observed. These awards are consistent with principles of motivation because they are contingent on good performance and are awarded immediately.

5. Using Skill-Based Pay:

With skill-based pay, employees are paid for the range, depth, and types of skills and knowledge they are capable of using rather than for the job they currently hold. Skill based pay is consistent with motivation theory because people have a self-concept in which they seek to fulfill their potential. The system also appeals to the employee’s sense of self-efficacy because the reward is a formal and concrete recognition that the person can do the more challenging job well.

6. Using Recognition:

Some employees highly value day-to-day recognition from their supervisors, peers and team members because it is important for their work to be appreciated by others. Recognition helps satisfy the need people have to achieve and be recognized for their achievement.
"Recognition is like a small drop of oil in the machinery of business. It just makes things run a little smoother."
-– Obert Tanner
Giving recognition makes employees confident in work: Report
Even as receiving recognition is the usual norm, many organisations are now opening channels for employees to give regular recognition to their co-workers and 90 per cent respondents said by doing so they feel more confident in their work, a report has said."Those who give recognition at work are more confident in their work. About 90 per cent of employees who noted that they always give recognition to employees feel that their work in the past 12 months has represented significant innovations," according to a OC Tanner report.
The report also revealed that 94 per cent of employees noted that they always give recognition to co-workers are proud to tell others they work for their organisation.OC Tanner conducted the study among 3,496 employees, who were over 18 years working full-time at companies with more than 500 workforce, in multiple countries across four continents, including the US, the UK, Canada, Australia, India, Singapore and Germany."Creating opportunities for giving, receiving and observing recognition, and devising a programme that focuses on all three, will help organisations increase employee engagement, wellbeing, innovation, work results and revenue," the report said. It said by giving recognition more often, employees not only feel more secure in their present circumstances, but are also more optimistic about their future.
• The report said that about 89 per cent agree that giving recognition creates a better company culture, while 79 said the giver works harder after they recognise another's achievement.
• 75 per cent respondents felt that giving recognition makes them want to stay at their current organisation longer.
• The report said 86 per cent agreed that giving recognition helped them better connect with their colleagues and 81 per cent felt it made them better connect to their organisations.
• Overall, the report has revealed that employees in the US and the UK give recognition at a higher rate than other countries.
• Australian, Canadian, and German employees fall in the middle range and while employees in the Asian countries of India and Singapore give recognition the least, it added.

7. Using Job Redesign:

Job design refers to the number and nature of activities in a job. The key issue is whether jobs should be more specialized or more enriched and no routine. Job design has been implemented in several ways. Job enlargement assigns workers to additional same-level tasks to increase the number of tasks they have to perform. Job rotation systematically moves workers from job to job. Job enrichment means building motivators like opportunities for achievement into the job by making it more interesting and challenging. Job enrichment may be implemented by forming natural work groups, combining tasks, establishing client relationships, vertically loading the job, and having open feedback channels.

8. Using Empowerment:

Empowerment means giving employees the authority, tools, and information they need to do their jobs with greater autonomy, as well as the self-confidence to perform new jobs effectively. Empowerment boosts employees’ feelings of self-efficacy and enables them to use their potential more fully.

9. Using Goal-Setting Methods:

People are strongly motivated to achieve goals they consciously set. Setting goals with employees can be a very effective way of motivating them. Goals should be clear and specific, measurable and verifiable, challenging but realistic, and set with participation.

10. Using Positive Reinforcement:

Positive reinforcement programs rely on operant conditioning principles to supply positive reinforcement and change behavior. Experts claim it is better to focus on improving desirable behaviors rather than on decreasing undesirable ones. There are a variety of consequences including social consequences (e.g., peer approval or praise from the boss), intrinsic consequences (e.g., the enjoyment the person gets from accomplishing challenging tasks), or tangible consequences (e.g., bonuses or merit raises).

11. Using Lifelong Learning:

Lifelong learning can be used to deal with problems of downsizing and employee commitment, and to counterbalance their negative effects. It provides extensive continuing training and education, from basic remedial skills to advanced decision-making techniques, throughout the employees’ careers, which provide employees the opportunity to boost their self-efficacy and self- actualization.
Facts
Presenteeism is the loss of productivity that occurs when workers are present but not performing. Causes of presenteeism include medical issues, personal and family-related issues, and negative workplace perceptions. Presenteeism can be reduced through employee satisfaction assessments, occupational and disability management, employee assistance programs, and work/life programs.

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[ 19 ]

20 ways to motivate your employees without raising their pay.

It is a costly mistake to get lost in the false theory that more money equals happy employees.
Believing this is costing you valuable time, revenue, employees...and even threatening your own job. Cash will always be a major factor in motivating people and a solid compensation plan is critical to attracting and keeping key personnel. But the key is that additional cash is not always the only answer and in many cases not even the best answer.
Too many bonus or commission checks get cashed, spent and forgotten just that quickly. Grocery stores and gasoline stations are among the necessary stops that
seem to get in the way of using your extra cash on something special for you.
One alternative to giving commissions or bonus dollars is to give gifts through a catalog point system.
The company you choose will provide you with catalogs, price sheets and point checks at no charge. The structure for your bonus plan can remain the same but instead of awarding cash to your employees you award equivalent points. Those points may then be used to purchase an enormous variety of gifts or travel plans from the catalog.
The stimulation involved is long-lasting. It begins with the employee being able to browse the catalog choosing what they will strive to earn. The catalog acts as a tangible reminder of their goal. The gift itself will last as evidence of their achievements.
Whenever I have implemented this program, the employees are overwhelmingly in favor of the point system as opposed to cash. This type of program is very popular with employees because they purchase things they would never normally have the "money" to afford.
With solid compensation in place, let's look at non-monetary motivation...20 steps to success.
1. Recognition/Attention. When your employees accomplish something they have achieved something. Your recognition is appreciation for that achievement. I believe that most managers don't give enough recognition because they don't get enough. Therefore, it doesn't come natural to do it. If this applies to you, you need to drop this excuse like a bad habit! Become a giver! Look at the price. Recognition is free!
2. Applause. A form of recognition yes, but a very specific form. Physically applaud your people by giving them a round of applause for specific achievements. Where? When? The answer is wherever and whenever. At meetings or company-sponsored social gatherings, a luncheon, or in the office. At the end of a shift, before a shift, and whenever possible in the middle of a shift.
Using plaques or trophies is another effective way of applauding your people. Although "wooden applause" is often successfully used in the form of Employee of the Month plaques, more creative ideas are sorely underutilized. Take the time to be creative, matching special accomplishments with unique awards.
3. One-on-One Coaching. Coaching is employee development. Your only cost is time. Time means you care. And remember your people don't care how much you know... until they know how much you care.
Whenever the emphasis is on positive feedback, I make sure to do this coaching in "public." Whenever you recognize and encourage people in "public," it acts as a natural stimulant for others who are close enough to see or hear what's taking place.
4. Training. Is training ever finished? Can you possibly overtrain? NO and NO. For whatever reasons, too many people feel "My people have already been trained" or "I've got good people...they only need a little training." But training never ends. Schedule "tune- up" training sessions. These should be led by you or by a supervisor with help from specific employees who show a particular strength in the skills taught. I know this takes time, but these types of training sessions will continually enhance the performance of your people and the productivity of your business.
5. Career Path. Your employees need to know what is potentially ahead for them, what opportunities there are for growth. This issue is a sometimes forgotten ingredient as to the importance it plays in the overall motivation of people.
Set career paths within your organization. Do you promote from within? I hope you can answer yes to that. Although specific circumstances require you to look for talent outside your company you should always first consider internal personnel. If you do this you are sending a very positive message to every one that there are indeed further career opportunities within your organization.
6. Job Titles. When you talk about job titles you are tapping the self-esteem of people. How someone feels about the way they are perceived in the workforce is a critical component to overall attitude and morale. Picture a social gathering that includes some of your staff. The subject of work inevitably comes up. Will your people be proud, or embarrassed, to share their title and workplace? The importance of feeling proud of who you are and what you do is monumental.
Be creative as you think of possibilities for titles. Have your staff come up with ideas giving them input into the titles. Bottom line, you are dealing with pride...and pride enhances a positive attitude...and a positive attitude is the foundation for continuing success.
7. Good Work Environment. A recent industry study shows just how inaccurate your results can be. Employers were asked to rank what they thought motivated their people
and then employees were asked to rank what really did motivate them.
Employers felt "working conditions" was a nine (or next to last) in terms of importance. What did the employees say? Number two! Working conditions are very important to the way employees feel about where they work.
Cosmetically, does your office look nice? Are there pictures on the walls, plants and fresh paint among other features that generally make people feel good about their environment? Does their work space have enough room or are they cramped in a "sardine can?" What about furniture? Is the desk the right size, chair comfortable? Is there file space and do they have the miscellaneous office supplies needed for maximum performance? Is the temperature regulated properly so they don't feel they're in the Amazon jungle one minute and the North Pole the next?
8. On-the-Spot Praise. This too is associated with recognition but the key here is timing. When there is a reason for praising someone don't put it off for any reason! Promptness equals effectiveness. Praise people when the achievement is fresh on everyone's mind.
What is effective is for us to get off our keisters and go out and tell whoever it is what a great presentation it was or applaud them for the sale...praise them promptly for what they accomplished or achieved! Don't allow time to creep in and snatch away any ounce of the positive impact that praise can have when it is delivered promptly.
9. Leadership Roles. Give your people leadership roles to reward their performance and also to help you identify future promotable people. Most people are stimulated by leadership roles even in spot appearances. For example, when visitors come to your workplace use this opportunity to allow an employee to take the role of visitors guide.
A great place to hand out leadership roles is to allow your people to lead brief meetings. Utilize your employees' strengths and skills by setting up "tune up" training sessions and let one of your employees lead the training. The best time to do this is when new people start.
Or, assign a meeting leader after someone has attended an outside seminar or workshop. Have them lead a post show, briefing the other employees regarding seminar content and highlights.
Have your employees help you lead a project team to improve internal processes.
10. Team Spirit. Have a picture taken on your entire staff (including you!), have it enlarged and hang it in a visible spot. Most people like to physically see themselves as part of a group or team.
When running contests in your area, try to create contests and affiliated activity that are team driven. People driving to reach goals together definitely enhance team spirit solely because they must lean upon others and be prepared to be leaned on.
One very effective idea for me has been building a collage of creative ideas with the "Team" theme. All employees are responsible for submitting a phrase referring to TEAM on a weekly rotation. Each of these ideas (such as TEAM: Total Enthusiasm of All Members or There is no I in Team) is placed on a wall, creating a collage of Team-oriented phrases. Don't have one person responsible for this...do it as a team.
11. Executive Recognition. This is the secret weapon. And like any secret weapon, timing is most critical. If this is used too often the value is diminished. And if it is used only for special occasions and rare achievements the value is escalated. We talked earlier about general recognition and the positive impact that has on your people. That will go up a few notches when it comes from an executive. Some of the same vehicles can be used here such as memos and voice mail. To add yet another level of stimulation, have an executive either personally call to congratulate someone (or a group) or even show up in person to shake hands and express his or her appreciation.
12. Social Gatherings. Scheduled offsite events enhance bonding which in turn helps team spirit, which ultimately impacts your positive work environment. Halloween costume parties, picnics on July 4th, Memorial Day or Labor Day, and Christmas parties are only some of the ideas that successfully bring people together for an enjoyable time. Some others that I've used with equal success are softball games (against other companies or among employees, depending on staff size), groups going putt-putt golfing or movie madness.
13. Casual Dress Day. This will apply more to the Business-to-Business world based on the difference in normal dress codes from the Business-to-Consumer arena. For those required to "dress business" every day a casual day becomes a popular desire. Use holidays to create theme color casual days such as red and green before Christmas or red, white and blue before July 4th, or black and orange prior to Halloween. This will add to the impact you're trying to have by calling a casual day in the first place. Establish pre-vacation casual days for each individual employee to enjoy on the day before his or her vacation.
Major sports events are a perfect opportunity for casual days to support your local or favorite team with appropriate colors, buttons, and logo wear. Spontaneous casual days produce a lot or stimulation based on the element of surprise. Announce a casual dress day for the following work day "just because." Use individual or team casual dress days as contest prizes or awards for specific accomplishment.
14. Time Off. Implement contests that earn time off. People will compete for 15 minutes or 1/2 hour off just as hard as they will for a cash award. And in many cases, I have had people pick time off over cash when given the choice. Put goals in place (padded of course) and when these goals are reached by individuals, teams or the entire staff, reward them with time off. Allow early dismissals, late arrivals, and extended lunch periods or additional breaks.
15. Outside Seminars. Outside seminars are a stimulating break. Because outside seminars are not always cost efficient for most people, consider on-site seminars or workshops for your staff. Use outside seminars as a contest prize for one or two people. Then set up a structured plan for those seminar attendees to briefly recreate the seminar to the rest of your people when they return. Now everyone gets educated for the price of one.
16. Additional Responsibility. There are definitely employees in your organization who are begging for and can handle additional responsibility. Our job as managers is to identify who they are and if possible match responsibilities to their strengths and desires.
17. Theme Contests. Over the years my contests have produced up to 170% increase in performance. But equally as important, they've helped maintain positive environments that have reduced employee turnover by 400%.
Overall the most successful contests seem to be those affiliated with different themes. Holidays, anniversaries, sports and culture are examples of ideas to base contests on. Sports, without a doubt, provide the largest opportunity for a wide variety of contests. Even Culture can be used to create theme contest. My favorite is using the '50s and '60s as a theme for a contest that I run at least once a year.
18. Stress Management. There are many articles and books available on the subject. Make this reference material available to your people. Make sure they know it is available and encourage them to use it.
If possible, have an in-house seminar on stress management techniques. So that production time is not lost, you might consider having a brown bag luncheon with a guest speaker on this subject. Because stress is an ongoing concern, anytime is a good time for a seminar like this to take place.
Be as flexible as you can with breaks during the course of the day.
19. Pizza/Popcorn/Cookie Days. Every now and then pizza, popcorn, or cookie days will help break up that everyday routine and help people stay motivated. Because it is a natural tendency for people to get excited in anticipation of something, structure some of these days in advance. Then buy some pizzas or different cookies or even whip out some different types of popcorn.
20. Gags and Gimmicks. Use different gimmicks as awards to help inspire performance increases from your people. The key to awards is establishing the perception of priceless value that is associated with them. They should be recognized as status symbols in your environment. Here are some of my ideas:
• Plastic/rubber whale for "whale" of a performance.
• Pillsbury dough boy for the person raisin' the most bread.
• Cardboard stars for star-studded performances.
• Plastic phonograph records for setting a new record.
• California raisins for those with the highest percentage of "raisin" their productivity.
• Special parking space for the person who drives the hardest.
• Toy cymbals for those "symbolizing" total effort.
• Special Mountain Dew can for that person who exemplifies the "can do" attitude.
• A figurine of E.T. for out-of-this-world performance.
• The Eveready Bunny for those that keep going, and going, and going.
• Large Tootsie Roll replica for those on a "roll."
• A drum for the person that "drums" up the most business.

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[ 20 ]

Employee Retention

Employee retention likely to be top focus for recruiters: Survey
When it comes to recruitment, employee retention and quality of people being hired are likely to be the top priorities for organisations in 2016, says a survey.
Employee Retention is a process in which the employees are encouraged to remain with the organization for the maximum period of time or until the completion of the project. Employee retention is beneficial for the organization as well as the employee.
Retention of employees is part of Human Resource management and planning efforts. Turnover, as the opposite of retention, often has been seen as a routine HR matter requiring records and reports. Indeed, retention of employee is not the matter that can be dealt by the reports or records, it is purely depends on how we understand individual concerns especially in case of woman employees who are planning for pregnancy. the only simple logic employers must understand from the employee point of view is, organisation must be like a helping hand for the genuine concerns. Thus, organizations are being forced to study why employees leave and why they stay. Sometimes an individual in the HR area is assigned to specifically focus on retention to ensure that it receives high priority.

Why do Employees Leave ?

Research says that most of the employees leave an organization out of frustration and constant friction with their superiors or other team members. In some cases low salary, lack of growth prospects and motivation compel an employee to look for a change. The management must try its level best to retain those employees who are really important for the system and are known to be effective contributors.
There is other side of the coin when it comes to women employees. According to the survey conducted, the major reason for woman employees leaving organisation is not about remuneration or compensation,dissatisfaction, constant friction with their superiors or with their peer or lack of growth prospects, lack of career development and no motivation by their employer. The major reason behind is at the time of pregnancy. For any person when it comes to family or job, there is no second thought, it is family. Therefore every organisation need to give special focus on the high priority issues of their employees and should be like a helping hand. Maternity benefits one of the key motivating and retention strategies for woman employees. Countries like India, enacted a special Act called Maternity Benefit Act,1961 for the ensuring of maternity benefit to women employees by their employer who are covered under the said Act. The said Act mandates compulsory maternity leave with salary and flexi- work in post maternity leave.
Maternity benefits curtails post-maternity attrition of women employees
India: Several organisations have over the last few years introduced new policies to curtail attrition among women employees post maternity. Between 2003 and 2010, according to Avtar, a diversity and inclusion consulting firm, over 48% of employed women under 30 years of age dropped out of the workforce due to maternity and childcare. It's a challenge organisations are facing headon. From flexi-work to phaseback programmes, no stone has been left unturned.
The hard work is finally paying off.Organisations are witnessing a gradual reduction in attrition levels among women employees post maternity.
Over the last three years, Maersk Group India has seen a steady decline in attrition among women employees post maternity from 30-33% in 20132014 and 24-26% in 2015 to 7% so far in 2016. IBM India, on the other hand, has reduced attrition among women employees by 10% in the last two years, while at Cummins, a return-to work programme called `Reboot' launched in May 2016 has already seen a positive outcome.
Maersk had in April-2016 introduced improved maternity benefits of a minimum 18 weeks of maternity leave on full pay and a phased return-to-work programme with reduced hours by 20% on full pay for up to six months to all employees who return from maternity leave. Year on year, 3-5% of its women workforce proceed on maternity leave. Maersk realised when women return to their careers, they may sense reduced confidence levels. Many lose leadership roles to their peers who remained in the workforce. It was critical for Maersk, which has a women-to-men workforce ratio of 30:70, to introduce a `return-to-work' initiative and transition employees on a career break to full-time careers. Here, women leaders are provided with real-time challenging business project opportunities, deployed through a holistic orientation and developmental programme focusing on specific skills and capabilities to settle in their roles at the earliest and assigned a mentor.
In 2009, Standard Chartered Bank was among the first companies to offer six months maternity leave. Soon, a bunch of companies started offering this. But even after offering the best-in-class six months, attrition rate of women who went on maternity leave was high, at 35-40%. Most returning mothers were plagued with guilt and in spite of having very understanding managers, they decided to drop off.
Hence it is the responsibility of the line managers as well as the management to ensure that the employees are satisfied with their roles and responsibilities and the job is offering them a new challenge and learning every day.
Employees today are different. They are not the ones who don’t have good opportunities in hand. As soon as they feel dissatisfied with the current employer or the job, they switch over to the next job. It is the responsibility of the employer to retain their best employees. If they don’t, they would be left with no good employees. A good employer should know how to attract and retain its employees.
Facts
Retaining that pool of talent was hardly a problem. That's changing, says Anupama Kalra, executive director at United Way, a US based funding organisation for NGOs.
Finding people is a challenge even within the sector as those with relevant experience demand multiples of their salary. For example, a programme officer with 2-3 years' experience who manages small NGO projects and makes around Rs 15,000-16,000 a month, could hope to get Rs 30,000 elsewhere. "That's the jump they're expecting - 30% to 50% and sometimes even 100%," says Kalra.
The Economic Times, 31 Jan, 2012,

Factors Affecting Employee Retention

Consciously hiring freshers is a popular practice across organisations these days. Most companies believe that hiring freshers from top colleges is a kind of guarantee that they will stick to the job for a relatively longer duration. While offering a good paycheck is important, companies need to go that extra mile to make sure their attrition rate is low. Progressive HR functions are now ensuring that freshers establish a long-term association with the company beyond the paycheck. Here are a few strategies they are employing:
1. A well-defined career path:
Employees, whether freshers or ones with experience, want to understand how the leadership of an organisation can facilitate their growth. They want to see tangible examples of how their counterparts have grown in the firm. For many, growth is not just a vertical ladder. A lateral lattice is equally important. The young workforce is keen on having early experiences of doing different things rather than being sandboxed into one job role. Hence, it is important for companies to chart out well-defined career paths that factor in a `variety of work' that encourages their employees to stick to the organisation.
2. Compensation
Compensation constitutes the largest part of the employee retention process. The employees always have high expectations regarding their compensation packages. Compensation packages vary from industry to industry. So an attractive compensation package plays a critical role in retaining the employees.
Compensation includes salary and wages, bonuses, benefits, prerequisites, stock options, bonuses, vacations, etc. While setting up the packages, the following components should be kept in mind:
• Salary and monthly wage: It is the biggest component of the compensation package. It is also the most common factor of comparison among employees. It includes
1. Basic wage
2. House rent allowance
3. Dearness allowance
4. City compensatory allowance
Salary and wages represent the level of skill and experience an individual has. Time to time increase in the salaries and wages of employees should be done. And this increase should be based on the employee’s performance and his contribution to the organization.
• Bonus: Bonuses are usually given to the employees at the end of the year or on a festival.
• Economic benefits: It includes paid holidays, leave travel concession, etc.
• Long-term incentives: Long term incentives include stock options or stock grants. These incentives help retain employees in the organization's startup stage.
• Health insurance:Health insurance is a great benefit to the employees. It saves employees money as well as gives them a peace of mind that they have somebody to take care of them in bad times. It also shows the employee that the organization cares about the employee and its family.
• After retirement: It includes payments that an Employee gets after he retires like EPF (Employee Provident Fund) etc.
• Miscellaneous compensation: It may include employee assistance programs (like psychological counseling, legal assistance etc), discounts on company products, use of a company cars, etc.
3. Work Relationships
Work relationships that affect employee retention include supervisory management support and coworker relations, A supervisor or manager builds positive relationships and aids retention by being fair and nondiscriminatory, allowing work flexibility and work-lamily balancing, giving feedback that recognizes employee efforts and performance, and supporting career planning and development.
Additionally, many individuals build close relationships with coworkers. Such work-related friendships do not appear on employee records, but these relationships can be an important signal that a workplace is positive. Overall, what this means is that it is not just where people work, but also with whom they work, that affects employee retention. If individuals are not linked with or do not relate wtll to their coworkers, there is greater likelihood for turnover lo occur.
4. Job and Work-Life
Many individuals have seen a decline in job security during the past decade. All the downsizings, layoffs, mergers and acquisitions, and organizational restructurings have affected employee loyalty and retention. As coworkers experience layoffs and job reductions, the anxiety levels of the remaining employees rise. Consequently, employees start thinking about leaving before they too get cut. Organizations in which job continuity and security are high tend to have higher retention rates.
Some jobs are considered "good" and others are thought to be "bad," but not all people agree on which jobs are which. As mentioned previously, the design of jobs and peoples' preferences can vary significantly. Job design factors that can impact retention include the following:
• A knowledge, skills, and abilities mismatch, either through overqualification or underqualification, can lead to turnover.
• Job accomplishments and workload demands that are dissatisfying or stressful may impact performance and lead to turnover.
• Both timing of work schedules and geographic locations may contribute to burnout of some individuals but not others.
• The ability of employees to balance work and life requirements affects their job performance and retention.
Numerous examples could be given on how each of these items affect retention, but one example conies from a survey of chief financial officers on the impact of these issues in their firms. In this survey, work-life flexibility efforts were seen as creating significant retention, recruitment, and productivity results. This study illustrates that how organizations address jobs can drive retention efforts, including global retention as discussed in the Human Resource Perspective.
5. Work-life balance:
Irrespective of their industry, it is important for working professionals to maintain a work-life balance.While high-paying jobs do demand longer hours of work, organisations should implement flexible working hours and work from home policies while respecting their core office culture. Practices like occasional work from home, flexible work arrangements, `ME' time (keeping a chunk of their time to pursue a hobby of their choice) are ways to help employees maintain a healthy work-life balance.
6. Organization Environment
It is not about managing retention. It is about managing people. If an organization manages people well, employee retention will take care of itself. Organizations should focus on managing the work environment to make better use of the available human assets. People want to work for an organization which provides
• Appreciation for the work done
• Ample opportunities to grow
• A friendly and cooperative environment
• A feeling that the organization is second home to the employee
Organization environment includes
• Culture
• Values
• Company reputation
• Quality of people in the organization
• Employee development and career growth
• Risk taking
• Leading technologies
• Trust
Facts
Watson Wyatt Worldwide is a leading provider of human capital and financial management consulting services. The company assists clients with employee retention and motivation, emerging opportunities in human capital management, and insurance and investment financial advice. The company was established in the U.K. in 1878 and has approximately 6,000 associates working in thirty countries.
The study surveyed 584 working Americans of whom 56 % agreed that, after compensation and benefits, feeling that they were appreciated would motivate them to stay in their current position. More women than men identified this as a significant factor (62 % compared to 50 %). This compares to 46 % of the total who said opportunities for career advancement would motivate them to stay. Just over half (54 %) felt that colleagues appreciated them more than supervisors or senior managers.
Other significant findings include:
• 68 % said they had received no useful feedback from the supervisors in the last six months
• 82 % have not agreed career goals with their supervisors
• 53 % lack a clear understanding of how their role contributes to the company objectives
• 25 % have been given new duties or responsibilities that they feel are beyond their skill set
7. Recognition and feedback:
Typically, bosses are quick on giving feedback when issues crop up.However, appreciation is rare when things go smooth. Letting your employees know that you appreciate their efforts, recognising and highlighting impactful outcomes and giving timely feedback is crucial. Similarly, gaining feedback from employees and engaging oneself in meaningful dialogues to improve areas that are creating obstacles is important.
8. Transparent and fair reviews:
Enabling transparent and clear reviews and appraisals for employees helps them achieve more with a clear picture of being rewarded on the basis of merit. The review process should celebrate key milestones in an employee's career in an organisation where the focus is on highlighting key achievements, strengths and development areas, followed by a mutually agreed upon goal setting discussion.

Myths and Realities about Retention

Keeping good employees is a challenge rhar all organizations share and that becomes even more difficult as labor markets change. Unfortunately, some myths have arisen about what it takes to retain employees. Some of the most prevalent myths and realities are as follows:
• Money is the main reason people leave. Money certainly is a vital HR tool, and if people feel they are being paid inadequately, they may be more likely to leave. Bui if they are paid close to the competitive level they expect, other parts of the job become more important.
• Hiring has little to do with retention. This is not true. Recruiting and selecting the people who fit the jobs and who are less likely to leave in the first place, and then orienting them to the company, can greatly increase retention. It is important to select for retention.
• If you train people, you are only training them for another employer. Developing skills in employees may indeed make them more marketable, hut it also tends to improve retention. When an employer provides employees with training and development assistance, job satisfaction may increase and employees are more likely to stay, particularly if they see more future opportunities internally.
• Do not be concerned about retention during organizational change. That is exactly the time to worry about retention. Although some people's jobs may have to be cut because of economic organizational factors, the remaining employees that the company would like to keep may have the most opportunity and reason to leave voluntarily. For example, during a merger or acquisition, most workers are concerned about job security and their employer's future. If they do not feel a part of the new organization early on, many may leave or evaluate alternatives.
• If solid performers want to leave, the company cannot hold them. Employees are best viewed as "free agents." who indeed can leave when they want. The key to keeping solidly performing employees is to create an environment in which they want to stay and grow.
Reference: Human Resource Management By Robert L. Mathis, John H. Jackson

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Source: Human resource management (web). www.whatishumanresource.com (english)